Varun Beverages' Q1 CY2026 Financial Results

Varun Beverages Limited (BSE: 540180, NSE: VBL), a key player in the beverage industry, announced its financial results for the first quarter ended March 31, 2026.

Financial Performance Highlights

Performance Review for Q1 2026 vs. Q1 2025

- Revenue from operations (net of excise / GST) grew by 18.1% YoY to Rs. 65,741.9 million in Q1 2026 as compared to Rs. 55,669.4 million Q1 CY2025

- Consolidated sales volume grew by 16.3% to 363.4 million cases in Q1 CY2026 from 312.4 million cases in Q1 CY2025 driven by strong volume growth of 14.4% in India and 21.4% in international territories

- Net realization per case improved by 1.6% at the consolidated level, supported by improved realizations in international territories primarily due to favorable currency movement

- Net realization per case in India declined by 1.5%, primarily due to volume growth initiatives such as upsizing of packs and selective price-point launches in targeted markets to onboard new consumers

- Gross margins improved by 62 bps at 55.2% in Q1 CY2026, supported by early stocking of key raw materials despite the inflationary raw material environment

- CSD constituted 73.6%, NCB 7.5% and Packaged Drinking Water 18.9% in Q1 CY2026

- In Q1 CY2026, mix of Low sugar / No sugar products has increased to ~ 63% of consolidated sales volumes

- EBITDA increased by 21.0% to Rs. 15,289.3 million in Q1 2026 from Rs. 12,639.6 million in Q1 2025

- EBITDA margins improved by 55 bps to 23.3% in Q1 CY2026

- In India, EBITDA margins improved by 112 bps driven by operational efficiencies from robust volume growth and improved gross margins

- PAT increased by 20.1% to Rs. 8,787.1 million in Q1 CY2026 from Rs. 7,313.6 million in Q1 CY2025 driven by strong volume growth in India and International territories

- Depreciation increased by 30.9% on account of commissioning of new plants of last year (Buxar, Prayagraj, Damtal and Meghalaya) which were not present in the base quarter

- Finance cost increased by 18.0% on account of acquisition of Twizza in South Africa in the current quarter. The income on surplus cash in India is accounted as other income

Commenting on the performance for Q1 CY2026 Mr. Ravi Jaipuria, Chairman, Varun Beverages Limited, said, "We are pleased to report a strong performance in the first quarter of CY2026, supported by healthy demand, disciplined execution, and continued progress across our markets. Consolidated sales volumes grew by 16.3% in Q1 CY2026, driven by volume growth of 14.4% in India and 21.4% in international territories. Revenue increased by 18.1% YoY to Rs. 65,742 million, and EBITDA improved by 21.0% YoY to Rs. 15,289 million.

In India, demand remained encouraging during the quarter, supported by our wide distribution reach, strengthened execution, and continued investments in manufacturing capacity and chilling infrastructure. We undertook targeted initiatives to drive volumes and strengthen our domestic portfolio, including pack upsizing, selective price-point launches in identified markets to onboard new consumers, and new launches in the energy and juice based drink segments. The facilities commissioned over the last year have stabilized well and are expected to support growth and enhance operating efficiencies going forward.

Our international business continued to make steady progress during the quarter. We consummated the acquisition of Twizza in South Africa through BevCo, strengthening our manufacturing footprint and route-tomarket capabilities in Africa's largest soft drinks market. The acquisition is expected to generate meaningful operational and commercial synergies over time. We have also entered into an agreement to acquire Crickley Dairy through BevCo, which will further strengthen our presence in South Africa, subject to regulatory and other approvals. Across Africa, we continue to build scale in snacks and deepen our presence in high-potential markets, in line with our strategy of broadening the portfolio and strengthening consumer relevance.

In accordance with our dividend policy, the Board of Directors has approved an interim dividend of 25% of face value, i.e., Rs. 0.50 per share, resulting in a total cash outflow of approximately Rs. 1,691 million.

Looking ahead, we remain confident in the long-term opportunity across our markets, supported by favorable demographics, rising incomes, growing urbanization, and increasing beverage consumption. With adequate capacities, a diversified portfolio, and a strong distribution network, we are well-positioned to deliver sustained growth and create long-term value for all our stakeholders."

Source : Equity Bulls

Keywords

VarunBeverages Q1CY2026 ResultUpdate